Second Injury Fund of Iowa v. Bergeson, 93-1567

• Decision Date: 18 January 1995
• Docket Number: No. 93-1567,93-1567
• Citation: 526 N.W.2d 543
• Parties: SECOND INJURY FUND OF IOWA, Appellant, v. Robert BERGESON, City Plumbing & Heating, Inc., and Dodson Insurance Group, Appellees.
• Court: Iowa Supreme Court

Page 543

526 N.W.2d 543

SECOND INJURY FUND OF IOWA, Appellant, v. Robert BERGESON, City Plumbing & Heating, Inc., and Dodson Insurance Group, Appellees.

No. 93-1567.

Supreme Court of Iowa.

Jan. 18, 1995.

Bonnie J. Campbell, Atty. Gen., and Robert D. Wilson, Asst. Atty. Gen., for appellant.

Dennis L. Hanssen of Hopkins & Huebner, P.C., Des Moines, for appellee employee.

Michael R. Hoffman and Steven R. Cantonwine of Michael R. Hoffman, P.C., Des Moines, for appellees employer and insurer.

Considered by McGIVERIN, C.J., and HARRIS, LARSON, CARTER, and ANDREASEN, JJ.

ANDREASEN, Justice.

This is an appeal from the district court's affirmance on judicial review of the industrial commissioner's decision. The commissioner determined that the claimant suffered an industrial disability caused by the combination of his first and second injuries which triggered the liability of the Second Injury Fund of Iowa. The commissioner also ordered the Fund to reimburse the employer's insurer for the amount the insurer overpaid the employee. We affirm.

I. Background.

Robert Bergeson was fifty-six years old at the time of the hearing before the deputy commissioner. He is a high school graduate and has worked as a plumber during most of his adult life.

In 1959, while employed as a plumber, Bergeson injured his right knee while carrying a bathtub. As a result of the injury, he had knee surgery--lateral meniscectomy--on his knee and the meniscus, an important part of the knee joint, was removed. Bergeson returned to work as a plumber without restrictions after recovering from the injury. He testified he had completely healed and that he could do everything after the injury that he could do before the injury. He also testified, however, that after the injury the knee was never as good as it had been before the injury. He occasionally sought medical treatment for his right knee after the 1959 injury. In 1980 an x-ray showed "severe degenerative changes manifested by spurs, sclerosis, and a moderate loss of cartilage space laterally." Dr. Grant, an orthopaedic surgeon, determined the partial permanent physical impairment to Bergeson's right leg to be ten percent.

Bergeson continued to work as a plumber until November 8, 1984 when he was injured while employed as a plumbing foreman for the family business. He was injured when a ditch caved in covering him with dirt up to his chest. The most serious injury was a shattered left leg femur bone. It is undisputed that Bergeson suffered a permanent left leg impairment from the 1984 injury. At the hearing, five years after the ditch cave in, Bergeson testified his left leg is shorter; therefore the balance that he had before the accident was lost. His foot has rotated sixteen degrees out so that when he walks, he walks on the edge of his foot. Because of his balancing problem, it is difficult for him to walk on uneven surfaces, to carry weights, to use a ladder, and to install pipe in a ditch. Two doctors gave impairment ratings of Bergeson's left leg. One estimated the impairment at twenty-three percent, the other at thirty-six percent.

Bergeson was unable to return to work as a plumber after the accident. On July 4, 1985 he began working part-time as a plumbing inspector for the city of Ames. The position became full time in November 1985.

The deputy found that Bergeson suffered a ten percent permanent partial impairment of the right leg from the 1959 injury and that the 1984 ditch cave in resulted in a work related second injury resulting in twenty-six percent permanent partial impairment of the left leg. Based on the combined effect of the two scheduled injuries to Bergeson's legs, the deputy commissioner concluded Bergeson suffered a forty percent industrial disability. The deputy commissioner determined that the employer was responsible for 57.2 weeks of permanent partial disability benefits from the second injury, the impairment value of the first injury was 22 weeks, and the Fund was liable to Bergeson for 120.8 weeks of permanent partial disability benefits. The deputy commissioner also found that the employer's insurance carrier had overpaid Bergeson by 12.8 weeks of compensation and ordered the Fund to reimburse the carrier for the amount it overpaid. The payment ordered was to come out of the Fund's liability to Bergeson and therefore did not add any to the Fund's total liability nor did it give any windfall benefits to Bergeson.

The Fund appealed to the commissioner who adopted the deputy's decision as final agency action. The Fund sought judicial review of the commissioner's decision in district court, which affirmed the commissioner. The Fund now appeals, claiming there is insufficient evidence to support the commissioner's decision and that there is no statutory authority to award Fund benefits to the employer's insurance carrier.

II. Scope of Review.

We review decisions of the industrial commissioner under Iowa Code chapter 17A. See Iowa Code § 86.26 (1993). Our review of the commissioner's decision is for error at law, not de novo. Second Injury Fund v. Braden, 459 N.W.2d 467, 468 (Iowa 1990). We broadly and liberally construe the commissioner's findings to uphold, rather than defeat the commissioner's decision. Second Injury Fund v. Hodgins, 461 N.W.2d 454, 456 (Iowa 1990). We must examine whether the commissioner's conclusions are supported by substantial evidence in the record made before the agency when the record is viewed as a whole. Iowa Code § 17A.19(8)(f). Evidence is substantial "if a reasonable mind would find it adequate to reach a conclusion. An agency's decision does not lack substantial evidence because inconsistent conclusions may be drawn from the same evidence." Second Injury Fund v. Shank, 516 N.W.2d 808, 812 (Iowa 1994). In reviewing the commissioner's interpretation of the statutes governing the agency, we defer to the expertise of the agency, but reserve for ourselves the final interpretation of the law. Braden, 459 N.W.2d at 468.

III. Disability Benefits.

There are two ways to evaluate permanent disability under Iowa's workers' compensation scheme. A functional disability involves determining the impairment of the employee's bodily function and is limited to the loss of the physiological capacity of the injured body or body part. Shank, 516 N.W.2d at 813. An industrial disability "goes beyond bodily impairment and measures the extent to which the injury impairs the employee's earning capacity." Id. A functional disability is one factor in determining industrial disability, but other factors including the employee's age, education, qualifications, experience, and the ability of the employee to engage in employment for which the employee is fit. Id.

Permanent partial disabilities are divided into scheduled and unscheduled losses under chapter 85. See Iowa Code § 85.34. If an injury is one of the specific losses listed in section 85.34(2)(a)-(t), it is a scheduled injury and is compensated on the basis of the number of weeks provided for that particular injury by statute. The compensation allowed for a scheduled injury "is definitely fixed according to the loss of use of the particular member." Graves v. Eagle Iron Works, 331 N.W.2d 116, 118 (Iowa 1983) (quoting Dailey v. Pooley Lumber Co., 233 Iowa 758, 760, 10 N.W.2d 569, 571 (1943)). If the injury is not one of the listed losses, it is treated as a "body as a whole" injury and compensated "during the number of weeks in relation to five hundred weeks as the disability bears to the body of the injured employee as a whole." Iowa Code § 85.34(2)(u). The result of this scheme is that an individual suffering an unscheduled injury often receives more benefits than an individual who suffers a scheduled injury, even if they are similarly affected in their ability to work. See Gilleland v. Armstrong Rubber Co., 524 N.W.2d 404, 407 (Iowa 1994). Functional disability is used to determine a specific scheduled disability; industrial disability is used to determine an unscheduled injury. Shank, 516 N.W.2d at 813 (citing Mortimer v. Fruehauf Corp., 502 N.W.2d 12, 15 (Iowa 1993)).

IV. Second Injury Fund Liability.

The Fund argues there is not substantial evidence to support the commissioner's findings either that Bergeson suffered a loss of use of his right leg or that the two injuries combined to create an industrial disability. The Fund argues that the only disability Bergeson currently suffers stems solely from the 1984 injury to his left leg, which is a scheduled injury. The Fund asserts that Bergeson is attempting to turn a scheduled injury to his left leg into an unscheduled injury by claiming benefits from the Fund and thus averting what some perceive as an unfair distinction between scheduled and unscheduled injuries. See Gilleland, 524 N.W.2d 404, 408 (Iowa 1994) (Lavorato, J., concurring specially).

The Second Injury Compensation Act is codified at Iowa Code sections 85.63 through 85.69. The Fund's purpose is to encourage the employment of disabled individuals. Aluminum Co. of Am. v. Quinones, 522 N.W.2d 63, 65 (Iowa 1994). Section 84.64 limits the liability of the employer in the event an employee suffers a specified second injury. The statute provides in part:

If an employee who has previously lost, or lost the use of, one hand, one arm, one foot, one leg, or one eye, becomes permanently disabled by a compensable injury which has resulted in the loss of or loss of use of another such member or organ, the employer shall be liable only for the degree of disability which would have resulted from the latter injury if there had been no pre-existing disability. In addition to such compensation, and after the expiration of the full period provided by law for payments thereof by the employer, the employee shall be paid out of the "Second Injury Fund " created by this division the remainder of such compensation as would be payable for the degree of permanent disability involved after first...